BSCIC industrial parks fail to live up to expectations

Lack of proper planning and political influence to blame

Star Business Report

The country is failing to grab the full socio-economic benefits from the industrial estates as many have been established only for political reasons. The Bangladesh Small and Cottage Industries Corporation has 74 industrial estates in 59 districts, of which at least 20 were established without any feasibility study, said its Chairman Shyam Sunder Sikder. Subsequently, the allotment policies were faulty, with many entrepreneurs refusing to set up factories in the allocated plots, he said at a roundtable styled “Past, Present and Future of BSCIC” at Ruposhi Bangla Hotel. “The plots are now sitting idle, with some being used for grazing cattle or as playgrounds. BSCIC has failed to ensure appropriate usage of the industrial estates.” Of the 5,747 industrial plots, 4,278 units are now in production, while 321 have either become sick or shutdown, according to the study. Some 487 plots are yet to be allocated. Poor communication, gas and electricity problems are the key huddles to attracting investment in the industrial estate, Sikder said. Though the industrial estates were set up for small industries, many large industries have set up plants by buying 14-15 plots gradually. Sikder urged the large companies to not expand their activities into the BSCIC estates taking the best interests of the small entrepreneurs into consideration. At the event, MM Akash, professor of economics at Dhaka University, also criticised the successive governments for building the industrial estates under political influence and overlooking the need for feasibility study before giving the go-ahead. “Since many BSCIC estates have been established without any proper assessment, the country cannot grab desired benefits from the industrial parks.” BSCIC should give more focus on creating new entrepreneurs by arranging funding for them, Khondaker Golam Moazzem, additional research director of Centre for Policy Dialogue, said, adding that access to credit is the key challenges to developing new entrepreneurs. The government should provide incentives for small industries as the sector contributes significantly to the economy, said Kazi Akram Uddin Ahmed, president of the Federation of Bangladesh Chambers of Commerce Industry. State Minister for Finance MA Mannan called upon the BSCIC to set up industrial estates targeting the food, poultry and fisheries sectors.

Industries Minister Amir Hossain Amu said the government will provide all sorts of policy support for the development of BSCIC, adding that the industrial estates have created employment for around 5.4 lakh people. The BSCIC industrial estates have 865 export-oriented units, with the companies exporting goods worth Tk 20,890 crore in fiscal 2012-13, which is 9.67 percent of the country's total export.